Specialist marine insurance intermediary Seacurus has developed a petro-piracy endorsement which can be added to existing Kidnap & Ransom (KR) insurance cover in response to the evolving threats to ships, their cargoes and crews when transiting the South China Sea, Malacca Straits, Indonesian Archipelago and Gulf of Guinea.
According to recent figures published by the International Maritime Bureau, South-East Asia accounted for three-quarters of global maritime piracy last year after a surge in tanker hijackings helped to fuel a 22 per cent jump in armed robbery and pirate attacks on ships in the region. There were 183 actual and attempted incidents of piracy and robbery involving ships in South-East Asian waters last year, compared to 150 in 2013. In the Gulf of Guinea, meanwhile, cargo theft is likely to remain on the agenda of Nigeria-based criminal gangs throughout 2015.
Denis Nifontov, Head of Marine K&R at Seacurus, says, “The criminal reach demonstrated by last year’s hijack of the tanker Kerala, coupled with the number of successful and attempted attacks in 2014 and the lack of any evidence that such gangs have been neutralised, suggests that further attempts at cargo theft will take place in 2015 across the region. Seacurus has recognised the need for traditional marine K&R cover to evolve to provide all interested parties with assurance that every eventuality is covered.
“The modus operandi of South-East Asian and Gulf of Guinea criminal gangs differs from the Somalian piracy model. Ships’ crews are regularly exposed to life-threatening situations as criminals take control of and ransack vessels, stealing valuable petro-chemical cargoes for commercial gain.”
The new cover from Seacurus recognises the need to protect crews against the potential for a kidnapping situation, and ship and cargo owners against the risk of business interruption and property theft. In addition to the benefits of a US$1m marine K&R policy, the cover includes as standard such additional benefits as loss of hire (US$500 000), loss or theft of cargo (US$500 000), loss of bunkers (US$250 000), and loss or theft of money (US$50 000) - all within an aggregate policy limit of US$5m.
Denis Nifontov says, “Given that, by its very nature, criminal activity is unpredictable, Seacurus believes that, for a small additional voyage cost, cover can be arranged to give all parties to the maritime adventure peace of mind that their interests are insured. Shipowners, charterers and cargo interests (who can be added to the policy as co-insureds to cover their own interests in the voyage), can buy US$5m of cover for a seven-day voyage for a typical premium cost of US$1250, subject to an assessment of the usual underwriting information. In this way, all parties can protect their standard marine insurances and insurance records from the potential for costly claims, whilst negating the need for costly and time-consuming recovery actions and General Average settlements.”
Adapted from press release by Joe Green